Defining “Direct Damage” for Cross‑Border Trade Secret Misuse under Rome II:
Commentary on Playtech Software Ltd v Realtime SIA & Anor [2025] EWCA Civ 1472

Court: Court of Appeal (Civil Division), England and Wales
Date: 21 November 2025
Citation: [2025] EWCA Civ 1472

1. Introduction

1.1 Background and parties

This appeal arises out of a cross‑border dispute in the online gambling software industry concerning alleged misuse of trade secrets and copyright. The case is of particular importance for conflict‑of‑laws rules governing non‑contractual obligations (Rome II) and for the jurisdictional gateways governing service out of the jurisdiction in English civil procedure.

The key parties are:

First Claimant – Playtech Software Ltd (“Playtech”): An English company at the apex of the Playtech Group, responsible for licensing online gambling games to operators and receiving licence revenues in the UK.
Second Claimant – Euro Live: A Latvian company within the Playtech Group, responsible for game development and employing developers in Latvia.
Third Defendant – MT: A Maltese company performing administrative and support functions for the Realtime Group.
Fourth Defendant – Realtime SIA (“Realtime”): A Latvian company that develops online gambling games, including for the Games Global Group, a commercial rival to Playtech.
Fifth Defendant – Igors Veliks: A Latvian national, formerly employed by Euro Live in Latvia, later employed by Realtime in Latvia.

Other defendants in the wider litigation (Games Global entities) fell out of the picture for the purposes of this appeal; the appeal concerns only Realtime and Mr Veliks.

1.2 Factual outline

While employed by Euro Live in Latvia, Mr Veliks had access to an internal platform called “Horizon”, hosting playable versions of Playtech games. Some of those games were publicly released; some were not. The High Court judge (Thompsell J) found that much of the Horizon content was public, but there was an arguable core of confidential information in the period between a game’s availability on Horizon and its public release.

Playtech’s essence of complaint is that:

After his employment with Euro Live ended, and using log‑in details given to him for that former employment, Mr Veliks accessed Horizon from Latvia; and
He thereby provided Realtime with access to Playtech’s confidential information, which was then allegedly used to develop two Realtime games, “Travel Fever” and “Diamond Rush Roulette” (the “Derivative Games”).

Originally the claim was largely contractual (breach of confidentiality clauses in Mr Veliks’ Latvian‑law employment contract and termination agreement, and inducing breach against Realtime/MT). Shortly before the High Court hearing, the Claimants:

Abandoned the contractual claims entirely and discontinued Euro Live’s claim; and
Re‑cast the case as:
- a claim by Playtech alone for misuse of trade secrets / breach of equitable confidence, and
- a new UK copyright claim focusing on a logo in Playtech’s game “Jet Set Racing Roulette”.

Service out of the jurisdiction was required because Realtime and Mr Veliks are based in Latvia.

1.3 The key legal issues

The appeal raised two central issues:

Applicable law and jurisdictional gateway for the trade secrets claim:
- Under Rome II, which country’s law applies to Playtech’s non‑contractual claim for misuse of trade secrets?
- Does Playtech have a “good arguable case” that direct damage for the trade secrets misuse occurred in the UK so as to engage Practice Direction 6B Gateway 21 for breach of confidence?
Proper forum for the copyright claim:
- Once the trade secrets element falls away (if it does), is England and Wales still the “clearly appropriate” forum for the standalone UK copyright claim, given that the screenshot and core conduct occurred in Latvia?

The Court of Appeal (with the lead judgment given by the same Lord Justice who decided Celgard v Senior) allowed the appeal. It held that:

The applicable law for the trade secret misuse claim is Latvian law; the claim does not pass through Gateway 21; and
England is not the appropriate forum even for the standalone copyright claim, given the availability and suitability of the Latvian courts.

2. Summary of the Judgment

2.1 Service out: the three requirements

To obtain permission to serve out of the jurisdiction (CPR r 6.37 and PD 6B), a claimant must show for each claim:

A serious issue to be tried on the merits;
A good arguable case that the claim falls within at least one jurisdictional gateway in PD 6B para 3.1; and
That England & Wales is clearly the appropriate forum in the interests of the parties and the ends of justice (the Spiliada test as summarized in Altimo and Vedanta).

2.2 The High Court’s approach

Thompsell J had held that:

There was a serious issue to be tried on both the misuse of trade secrets and the copyright infringement claim.
The trade secrets claim passed through:
- Gateway 9 (tort) and
- Gateway 21 (breach of confidence / misuse of private information).
The copyright claim passed through Gateways 9 (tort) and 11 (property within jurisdiction).
England was the proper forum, influenced significantly by his view that English law applied.

2.3 The Court of Appeal’s core holdings

The Court of Appeal disagreed on key points:

Correct gateway for trade secrets claims: It was accepted that the relevant gateway is Gateway 21 (breach of confidence), not Gateway 9. So reliance on Gateway 9 was erroneous.
Applicable law and “direct damage” for the trade secrets claim:
- The claim falls under Article 6(2) of Rome II as an act of unfair competition affecting only a specific competitor (Playtech), leading to Article 4.
- Article 4(1) directs to the law of the country in which the damage occurs, understood as direct damage, not indirect economic consequences (recital (16); Lazar v Allianz).
- On the pleaded facts and evidence, all acts of access and use of the alleged trade secrets occurred in Latvia. There was no evidence that the Derivative Games were ever available, downloaded or accessed in the UK.
- Playtech’s pleading that, as a UK company, “all such damage is suffered in this jurisdiction” was held to concern only indirect economic consequences (loss of UK licensing revenues), not the place of direct damage.
- Accordingly, the direct damage was sustained in Latvia, so the applicable law under Article 4(1) is Latvian law, not English law.
- Because Gateway 21(a) and (d) both presuppose direct damage (in the UK or under English law), the misuse of trade secrets claim does not pass through Gateway 21. Nor could English law properly be used to assess a serious issue to be tried on the merits.
No need to address Article 4(3) or Trade Secrets Directive Article 4(5):
- Given that Article 4(1) clearly pointed to Latvian law, it was unnecessary to consider the “manifestly closer connection” escape clause in Article 4(3).
- It was similarly unnecessary to revisit the Court’s provisional view in Celgard v Senior on Article 4(5) of the Trade Secrets Directive concerning “unlawful use” of trade secrets.
Copyright claim – appropriate forum:
- With the trade secrets claim out, the Court examined whether England was the appropriate forum for the standalone UK copyright claim.
- The alleged conduct:
  - Taking the screenshot of the Playtech game (including its logo) occurred in Latvia.
  - Later alleged acts of importation and distribution in the UK (sending the screenshot in London) were short‑lived and ancillary.
- Unchallenged expert evidence of Latvian law showed that:
  - Playtech could sue in Latvia for infringement of Latvian copyright regarding the taking of the screenshot; and
  - A Latvian court would be prepared to determine secondary infringement of UK copyright as part of the same proceedings, with foreign law proved through certified translations and, if necessary, assistance from the Ministry of Justice.
- Latvia was thus an available and appropriate forum, and the “centre of gravity” of the dispute was in Latvia, not England.
- Accordingly, England and Wales was not the proper forum even for the copyright claim alone.
Outcome:
- The appeal was allowed.
- Permission to serve the claim form on Realtime and Mr Veliks outside the jurisdiction was set aside.

3. Precedents and Legal Framework

3.1 Protection of trade secrets and the Trade Secrets Directive

The Court referred back to its earlier decision in Celgard LLC v Shenzhen Senior Technology Material Co Ltd [2020] EWCA Civ 1293, [2021] FSR 1, where the same Lord Justice had:

Summarised the pre‑Directive English common law of breach of confidence.
Set out the relevant provisions of the Trade Secrets Directive (Directive 2016/943/EU).
Discussed its partial implementation via the Trade Secrets (Enforcement, etc) Regulations 2018 (SI 2018/597).

That previous exposition is expressly “taken as read” and not repeated in detail, but it forms the backdrop: English law now protects trade secrets both through equitable obligations of confidence and, to an extent, through the specific statutory regime implementing the Directive.

3.2 Rome II Regulation – Articles 4 and 6

The central conflict‑of‑laws instrument is Regulation (EC) No 864/2007 (“Rome II”), which continues to apply in UK domestic law post‑Brexit via the 2019 EU Exit Regulations.

The structure relevant to this case is:

Article 6(2): For acts of unfair competition affecting exclusively the interests of a specific competitor, Article 4 applies. Here, misappropriation of trade secrets to develop rival games is an act of unfair competition solely impacting a single competitor, Playtech, so Article 6(2) is squarely engaged.
Article 4(1): The default rule:
“Unless otherwise provided for in this Regulation, the law applicable to a non-contractual obligation arising out of a tort / delict shall be the law of the country in which the damage occurs irrespective of the country in which the event giving rise to the damage occurred and irrespective of the country or countries in which the indirect consequences of that event occur.”
Article 4(3): Escape clause:
“Where it is clear from all the circumstances of the case that the tort/delict is manifestly more closely connected with a country other than that indicated in paragraphs 1 or 2, the law of that other country shall apply.”

Recital (16) and the CJEU’s decision in Lazar v Allianz SpA (Case C‑350/14) make clear that “the country in which the damage occurs” refers to the place of direct damage, not the place where the harmful event occurred nor where indirect economic consequences are felt.

3.3 Jurisdictional Gateways and Gateway 21

Under CPR r 6.37 and Practice Direction 6B para 3.1, permission to serve out requires the claim to come within a listed “gateway”. Here the crucial gateway is:

Gateway 21 – Breach of confidence or misuse of private information:

“A claim is made for breach of confidence or misuse of private information where:

detriment was suffered, or will be suffered, within the jurisdiction; or

detriment which has been, or will be, suffered results from an act committed, or likely to be committed, within the jurisdiction;

the obligation of confidence or right to privacy arose in the jurisdiction; or

the obligation of confidence or right of privacy is governed by the law of England and Wales.”

For a non‑contractual trade secrets claim, the question whether the obligation of confidence is governed by English law (para (d)) must itself be answered by applying Rome II.

3.4 Prior case law shaping the Court’s reasoning

3.4.1 Celgard LLC v Shenzhen Senior Technology Material Co Ltd

Celgard is the most important substantive precedent. It involved battery separator technology alleged to incorporate Celgard’s trade secrets. Two types of claim were advanced:

Direct Claim: Senior’s importation and marketing in the UK of infringing battery separators whose design, functioning or production allegedly benefitted from Celgard’s trade secrets.
Vicarious Claim: Senior’s vicarious liability for a former Celgard employee (Dr Zhang) disclosing Celgard’s trade secrets to Senior in China.

The Court of Appeal held that:

For the Direct Claim, the relevant act of unfair competition was the importation and marketing of the infringing goods in the UK. The UK market was the market affected, and the direct damage was sustained in the UK. English law therefore applied under Article 4(1).
For the Vicarious Claim, the direct damage caused by Dr Zhang’s disclosure occurred in China, so Chinese law governed that claim.

The Court also noted (without finally deciding) that under Article 4(5) of the Trade Secrets Directive, the production or marketing of infringing goods is also an “unlawful use” where the person knows that the trade secret was itself unlawfully used, and gave a provisional view that the law identified by Rome II would still govern that assessment.

This case is thus the template for determining the locus of direct damage in cross‑border trade secrets/unfair competition claims. The present judgment refines its application in the setting of intangible digital products and the absence of any marketing in the UK.

3.4.2 Kitechnology BV v Unicor GmbH [1995] FSR 765

Kitechnology established that, under English law, breach of confidence is not a tort. This matters because:

Rome II applies to “non‑contractual obligations” broadly, not only to torts, so breach of confidence nonetheless falls within its scope.
But for procedural matters (such as gateway 9, the “tort” gateway), the Court rightly recognised that it was erroneous to treat breach of confidence as a tort claim; hence the acceptance on appeal that Gateway 21, not Gateway 9, is the correct route.

Kitechnology was also cited by analogy for the distinction between place of direct damage and place where loss is ultimately suffered by the claimant in the context of jurisdiction under the Brussels Convention. That distinction informed the Court’s rejection of Playtech’s attempt to rely simply on being a UK‑based company suffering lost revenues in the UK.

3.4.3 Lazar v Allianz SpA (Case C‑350/14)

The Court drew on Lazar for the interpretation of “country in which the damage occurs” under Rome II Article 4(1). The CJEU there confirmed that:

“Damage” means the place where the direct harm manifests itself; and
Indirect or consequential loss in other countries (e.g. the claimant’s financial loss at home) does not determine the applicable law.

That framework is central to the conclusion that Playtech’s UK‑based financial losses are only indirect consequences of acts of misuse committed abroad.

3.4.4 AMT Futures Ltd v Marzillier [2015] EWCA Civ 143, [2015] QB 399

In AMT Futures, the Court of Appeal considered Article 5(3) of the Brussels I Regulation (special jurisdiction in matters relating to tort, “place where the harmful event occurred”). The case emphasised:

The need to distinguish where the harmful event occurred from where financial loss is felt by the claimant.
That the mere fact a claimant is domiciled in a state or experiences financial loss there does not suffice to give that state jurisdiction for the purposes of “place of damage”.

Although Brussels I concerns jurisdiction rather than applicable law, the Court treated the conceptual distinction as directly analogous to Rome II. AMT Futures thus reinforces the rejection of the argument that being a UK‑incorporated claimant with UK revenues automatically makes the UK the place of damage.

3.4.5 Forum cases: Altimo, Lungowe v Vedanta and Spiliada

On the proper forum question, the Court applied the familiar Spiliada test (“the forum in which the case may be tried more suitably for the interests of all the parties and the ends of justice”), as summarised by Lord Collins in Altimo Holdings and Investment Ltd v Kyrgyz Mobil Tel Ltd [2011] UKPC 7 and reiterated by Lord Briggs in Lungowe v Vedanta Resources plc [2019] UKSC 20.

The key connecting factors considered include:

Where the wrongful acts occurred;
Where the harm occurred;
Which legal system governs the claim(s);
Practical factors: location of parties and witnesses, language, cost, and procedural manageability.

In the present case, once the trade secrets claim dropped away, these factors pointed decisively towards Latvia as the appropriate forum for the remaining copyright dispute.

4. Detailed Analysis of the Court of Appeal’s Reasoning

4.1 Ground 1 – Applicable law and Gateway 21 for the trade secrets claim

4.1.1 The reformulated claim and its factual focus

By the time of the appeal, Playtech’s Amended Particulars of Claim (post‑High Court filtering) confined the trade secrets misuse claim to two categories of acts:

Accessing information on Horizon while it was confidential; and
Using that information to develop the Derivative Games (Travel Fever and Diamond Rush Roulette).

The Court noted that, on Playtech’s own pleaded case and supporting evidence:

At least 94% of the alleged Horizon access events took place from IP addresses in Latvia (none from the UK).
The development of the Derivative Games was likewise carried out in Latvia by Realtime and its staff.
No act of trade secret access or use was alleged to have occurred within the UK.

This is a crucial contrast with Celgard, where there was importation and marketing of infringing goods in the UK itself.

4.1.2 Playtech’s pleaded damage and the “direct/indirect” distinction

Playtech’s pleaded damage (paras 33–34 of the re‑amended Particulars) was framed as follows:

As a UK‑registered company, all damage is said to be suffered in the UK “irrespective of the place where the acts leading to said damage occurred”.
Realtime obtained a “springboard advantage” by using Playtech’s confidential information to accelerate the development of its games, thereby:
- Gaining time‑to‑market advantages in a highly competitive online gaming market;
- Negatively impacting Playtech’s licensing revenues, which Playtech receives in the UK.

The Court held that this pleading is entirely about indirect economic consequences for Playtech as a UK‑domiciled entity—namely loss of revenue flowing back to it in the UK—not about the place where the direct damage occurred.

Relying on Kitechnology and AMT Futures (in the Brussels context) and on Lazar and Recital (16) in the Rome II context, the Court emphasised:

The seat or domicile of the claimant, and the place where loss is ultimately felt, are not determinative of the place where the “damage occurs” for Article 4(1).
Direct damage must instead be linked to the state where the unfair competition or wrong manifests its first and immediate harmful effects.

In this case, the first and immediate harmful effect of the misuse was that Realtime, in Latvia, gained a competitive advantage in developing and launching its games. Playtech’s UK‑based economic loss was merely a down‑stream financial consequence.

4.1.3 Why the Celgard analogy failed

The High Court judge had reasoned that there was a strong analogy with the Direct Claim in Celgard, treating Playtech’s competitive harm in the UK as essentially the same type of direct damage as in an importation case. The Court of Appeal rejected that:

In Celgard, infringing physical goods were imported and marketed in the UK. The UK market was therefore clearly the locus of the unfair competition and direct damage.
In the present case:
- The product is intangible (online games) but that, in itself, is not decisive.
- The crucial difference is that there was no evidence or even allegation that the Derivative Games were made available, downloaded or accessed by anyone in the UK.
- Thus, unlike in Celgard, there is no act of competitive exploitation in the UK market by Realtime.

In other words, to mirror Celgard in an intangible context, Playtech would have needed to show that games allegedly developed with misused trade secrets were actually commercially exploited or targeted at the UK. The absence of such pleading and evidence was fatal.

4.1.4 Applicable law: Latvia, not England

Given that:

All acts of alleged misuse (access and use of trade secrets) occurred in Latvia; and
There was no allegation or proof of exploitation of the Derivative Games in the UK;

the Court concluded that the only direct damage occurred in Latvia. Under Article 4(1) Rome II, the law of Latvia therefore governs the non‑contractual obligation arising out of misuse of trade secrets.

This has two procedural consequences:

Gateway 21 cannot be satisfied:
- Paragraph (a) – “detriment was suffered within the jurisdiction” – fails because there was no direct damage in the UK.
- Paragraph (d) – “obligation of confidence is governed by the law of England and Wales” – fails because, under Rome II, the obligation is governed by Latvian law.
Serious issue to be tried cannot be assessed under English law:
- The judge had applied English law to hold there was a serious issue to be tried on the merits.
- But where foreign law is the applicable law, that foreign law must be pleaded and proved (or presumptively applied if unchallenged), not automatically replaced by English law.
- Having found that Gateway 21 was not met, the Court did not need to go on to examine Latvian law; the jurisdictional hurdle itself was insurmountable.

4.1.5 Non‑engagement of Article 4(3) and Article 4(5) Trade Secrets Directive

Realtime and Mr Veliks had argued below that even if Article 4(1) seemed to point elsewhere, Article 4(3) could still direct the Court to Latvian law because of a manifestly closer connection. On the appellate analysis, however, Article 4(1) itself clearly selected Latvia, so there was no room for Article 4(3).

Furthermore, the Court noted that because the case did not involve infringing goods being marketed in the UK, there was no need to revisit its provisional view in Celgard on Article 4(5) of the Trade Secrets Directive (which treats production/marketing of infringing goods as unlawful use). That complex question remains open for a case where it truly matters.

4.2 Ground 2 – Appropriate forum in respect of the copyright claim

4.2.1 The nature of the copyright claim

Playtech’s new copyright claim alleged:

The logo in its game “Jet Set Racing Roulette” is an original artistic work with UK copyright owned by Playtech.
While in Latvia, Mr Veliks accessed the game on Horizon using his phone and took a screenshot (allegedly including the logo).
He subsequently flew from Riga to London for a trade show, where he imported the screenshot into the UK and shared it with a colleague also present in London.

On that basis, Playtech alleged acts of infringement of UK copyright by importation, possession and distribution in the UK, with Realtime being vicariously liable.

4.2.2 Availability of Latvian proceedings and treatment of foreign copyright

Expert evidence on Latvian law (unchallenged on appeal) established that:

Playtech could bring proceedings in Latvia for infringement of Latvian copyright arising from the taking of the screenshot in Latvia.
In that context, the Latvian court would be prepared also to determine a claim concerning secondary infringement of UK copyright (e.g., subsequent dissemination in the UK), provided:
- The relevant provisions of UK law are supplied in certified translation; and
- If necessary, the court may seek assistance from the Latvian Ministry of Justice in understanding the foreign law.

Contrary to the High Court’s apparent concern, this approach does not require full expert evidence on UK law in the way English courts require proof of foreign law. The Latvian court can and does routinely apply foreign law based on the statutory text and official guidance.

4.2.3 Centre of gravity and forum non conveniens

The Court of Appeal observed that the centre of gravity of the copyright claim was in Latvia:

The screenshot was taken in Latvia while Mr Veliks was based there.
Both Mr Veliks and his colleague returned to Latvia almost immediately after the UK trade show.
Realtime is a Latvian company and any vicarious liability claim focuses on conduct by its Latvian employees.

Although some acts (importing the screenshot into the UK and sending it to a colleague while in London) occurred physically in England, these were compared with the core conduct and the parties’ location. When viewed against the broader factual background and the concurrent Latvian copyright claim, Latvia is “plainly the appropriate forum”.

Moreover, once the trade secrets claim is removed from the English proceedings, there is no longer any cohesive multi‑issue reason to anchor the litigation in England. The Court therefore concluded that, even taken alone, the copyright claim should be litigated in Latvia.

5. Complex Concepts Simplified

5.1 Trade secrets, confidential information and equitable obligations

Trade secrets are a subset of confidential information that:

Is secret (not generally known or readily accessible);
Has commercial value because it is secret (e.g. algorithms, know‑how, technical specifications); and
Has been subject to reasonable steps to keep it secret.

Under English law, even before the Trade Secrets Directive, such information was protected via the equitable doctrine of breach of confidence. A person who receives information in circumstances importing a duty of confidence (for example, an employee accessing an internal development platform) must not misuse or disclose that information without permission.

In this case, Playtech’s trade secrets claim was framed equity‑only (having dropped contract claims). It argued that both Realtime and Mr Veliks owed duties of confidence to Playtech and misused confidential Horizon information to develop competing games.

5.2 Rome II – the idea of “direct damage”

Rome II tells us which country’s law applies to a non‑contractual claim (e.g. misuse of trade secrets). Article 4(1) says we look to the “country in which the damage occurs”, but courts have long recognised a critical distinction:

Direct damage: The immediate harmful effect of the wrongful act. In trade secret/unfair competition cases, this is often the state where the misused information is exploited in the market.
Indirect consequences: Later or purely financial losses in other places (e.g. lost profits at the claimant’s head office in another country).

Only the place of direct damage is relevant to determining the applicable law under Article 4(1). The present case confirms that being a UK company that feels financial loss in the UK does not, by itself, make the UK the place where “damage occurs” under Rome II.

5.3 Service out, “good arguable case” and “serious issue to be tried”

When suing a foreign defendant, a claimant needs permission to serve the claim out of the jurisdiction. This is a filtering mechanism. The court asks:

Is there a serious issue to be tried on the merits (similar to a real prospect of success)?
Does the claim fall within a recognised jurisdictional gateway in PD 6B (e.g. Gateway 21 for breach of confidence)? The claimant must show a good arguable case—meaning that, on the material available, its case is more plausible than not.
Is England & Wales clearly the appropriate forum?

In this judgment, the Court clarifies that one cannot satisfy Gateway 21(d) by simply asserting that the obligation of confidence is governed by English law; that must be demonstrated by applying Rome II. Equally, Gateway 21(a) can’t be engaged by asserting that all economic loss is felt in the UK; the loss must count as direct damage for conflict‑of‑laws purposes.

5.4 Forum non conveniens / the Spiliada test

The doctrine of forum non conveniens allows a court to stay or refuse proceedings if another forum is clearly more appropriate. The Spiliada test, as developed and refined in later cases (Altimo, Vedanta), asks:

What are the jurisdictions in which the dispute could be suitably tried?
Which of them has the closest and most real connection to the issues and parties?
Do justice and convenience favour that alternative forum?

Factors include location of witnesses, evidence, governing law, and where the alleged wrongs and harm occurred. Here, once the trade secrets claim is removed, Latvia plainly emerges as the most appropriate forum for the narrower copyright dispute.

5.5 Primary vs vicarious liability

Primary liability arises when a party itself commits the wrongful act (e.g. Realtime’s own use of trade secrets in game development). Vicarious liability arises when a party is held liable for others’ wrongdoing (typically employees), committed in the course of their employment.

In Celgard, the Court drew a distinction between:

The primary wrong of marketing infringing goods in the UK (direct damage in UK), and
The separate wrong of an employee’s disclosure in China (direct damage in China).

In this case, all alleged acts giving rise to both primary and vicarious liability for misuse of trade secrets were located in Latvia. There was no separate UK‑based primary wrong analogous to the importation in Celgard.

6. Impact and Implications

6.1 Clarifying “direct damage” in cross‑border trade secret cases

The most important doctrinal impact of this case is its tightening of the concept of “direct damage” for trade secrets and unfair competition claims under Rome II. The Court makes clear that:

Where the misuse and exploitation of trade secrets occur entirely abroad, and
There is no proof that the derivative product is marketed or exploited in the UK,
The applicable law will generally be that of the country where those acts occur, even if:
- The claimant is a UK company; and
- The financial impact is felt in the UK.

This is a caution against “anchoring” such disputes in England merely by pointing to UK corporate residence and centralised revenues. Claimants must instead be prepared to litigate in the jurisdiction where the core misuse and exploitation takes place.

6.2 Application to intangible digital products

Celgard dealt with physical infringing goods imported into the UK. Playtech v Realtime shows how the same principles apply to intangible digital products (online gambling games):

If those products are made available in the UK market, the UK may well be the place of direct damage and English law could apply.
But if those products are developed and deployed abroad, without UK marketing or access, the place of direct damage will usually be the foreign state where that exploitation occurs.

The decision suggests that the key connecting factor remains market exploitation (or equivalent use) in the forum state, not the mere digital accessibility or the claimant’s domicile.

6.3 Pleading strategy and evidence for claimants

For rights‑holders intending to bring cross‑border trade secrets claims in England, this case has practical consequences:

Plead and prove UK‑specific exploitation: Simply pleading that a rival gained a competitive edge resulting in lower revenues in the UK will not suffice. Concrete allegations and evidence are needed that:
- Products or services developed with misused trade secrets were targeted at, made available in, or accessed by users in the UK; and
- This exploitation constituted the direct market harm.
Be wary of abandoning contract claims: Playtech’s decision to drop its contractual claims (which were tied to Latvian law and Latvian jurisdiction clauses) may have been driven by a desire to avoid those clauses, but it also removed a potential “pre‑existing relationship” connection that might have been relevant under Article 4(3), and left the Court with a bare non‑contractual claim clearly centred in Latvia.
Foreign law must be confronted: Where Rome II points to foreign law, the claimant must accept that:
- The merits will be assessed under that foreign law; and
- English law cannot simply be substituted for convenience.

6.4 Forum shopping and post‑Brexit cross‑border IP litigation

Post‑Brexit, English courts remain attractive fora for IP and trade secrets disputes. But Playtech v Realtime demonstrates a willingness of the Court of Appeal to:

Resist attempts at forum shopping where the real centre of gravity lies abroad.
Give full effect to Rome II and to foreign courts’ ability to handle complex IP disputes (including the application of foreign copyright law).

The decision also illustrates that EU Member State courts (such as Latvia’s) are ready and able to apply non‑domestic IP laws (here, UK copyright) as foreign law issues within their own proceedings. This undercuts any argument that English courts enjoy a unique institutional competence justifying jurisdiction in marginal cases.

For online and technology businesses with cross‑border operations, the case reinforces that where you operate and where the alleged misuse occurs may be more decisive than where you are headquartered. Internal policies on trade secret protection and enforcement planning must therefore take into account the legal regimes and courts of the places where development and exploitation occur, not just the group parent’s domicile.

7. Conclusion

Playtech Software Ltd v Realtime SIA & Anor delivers a clear and important message in the law of cross‑border trade secrets and jurisdiction:

For non‑contractual trade secrets claims under Rome II, the place of direct damage is what matters. Where the misuse and exploitation of the trade secrets occurs entirely in another state, and there is no UK‑market exploitation, the applicable law will be that foreign law, even if the claimant is based in the UK and suffers economic repercussions there.
Gateway 21 cannot be satisfied merely by asserting UK domicile and UK financial loss. The governing law of the obligation of confidence must be identified through Rome II, and direct damage in the UK must be shown if detriment‑based limbs of the gateway are relied upon.
On forum, even where some acts occur in England (such as a transient importation of a screenshot), the court will look at the overall centre of gravity of the dispute. Here, with the core acts and parties rooted in Latvia and a fully available Latvian forum, England was not the appropriate place for the copyright claim either.

The judgment refines and limits the reach of the earlier Celgard decision by demonstrating that Celgard‑style reasoning on direct damage applies only where there is demonstrable UK‑market exploitation. It underscores the importance of rigorous pleading and evidence of UK‑specific exploitation when seeking to establish English jurisdiction and English law in cross‑border trade secrets litigation, particularly in the context of intangible and digital products.

In the broader legal landscape, the case strengthens the principled application of Rome II and the Spiliada doctrine in an area—trade secrets and IP—often prone to expansive jurisdictional claims. It stands as a key authority on defining “direct damage” and resisting forum shopping in cross‑border trade secrets and IP disputes.

Defining “Direct Damage” for Cross‑Border Trade Secret Misuse under Rome II: Commentary on Playtech Software Ltd v Realtime SIA & Anor [2025] EWCA Civ 1472